The major goal of this project is to develop MRI tools that enable functional imaging of the intact brain. We have continued our efforts on the development of an MRI technique that allows quantitation of perfusion with the resolution of 1H MRI. A technique that relies on the use of endogenous water as a perfusion tracer has been developed at this Center. Endogenous arterial water is magnetically labeled by adiabatic inversion and the theory has been developed to quantitate tissue perfusion based on the measured changes in 1H MRI image intensity due to labeling. An important area of improvement in the perfusion imaging technique is to increase signal to noise. A variety of different approaches have been envisioned, and simulations have been carried out to determine the benefits of these sequences. When a single RF coil is used for labeling as well as detection, the single largest factor affecting signal-to-noise is the signal loss due to magnetization transfer effects. A two-coil scheme has been implemented that eliminates this signal loss. The thoery has been developed for quantitating perfusion in the case of the two-coil scheme. An assumption made in quantitating perfusion using arterial spin labeling is that water is freely diffusible. Using a two-coil scheme, we have investigated this assumtion of free-diffusibility, and measured the extraction fraction of water at varying blood flow levels. The integrity of the blood brain barrier also has been imaged with the help of the two-coil scheme. Finally, we have begun to attempt to make perfusion images of the mouse brain and hope to develop techniques to image awake mice performing "cognitive" tasks in the magnet. Development work is also under way to directly image neuronal activation using manganese ion as a marker, and to track cell migration and gene expression using genetically engineered mice with iron as a marker.